17.03.202309:49 Forex Analysis & Reviews: Analysis and trading tips for GBP/USD on March 17

Analysis of transactions and tips for trading GBP/USD

The pair tested 1.2084 at a time when the MACD line was just starting to move above zero, which was a good signal to buy. This resulted in a price increase of about 25 pips. No other market signal appeared for the rest of the day.

Investors were very much convinced that the ECB, despite all the turmoil in the banking sector, will not move away from its tight monetary policy. This, in turn, influenced expectations that the Bank of England will also stick to its plans and announce a rate hike as early as next week, which was a reason to buy pound. But even though the currency has every chance to renew highs, also thanks to the completely empty macroeconomic calendar today, the upside potential will be limited because the US is set to release data on industrial production in the afternoon, followed by a report on consumer expectations and consumer sentiment from the University of Michigan. Good numbers are likely to bring back demand for dollar, which could lead to a correction in GBP/USD later in the week.

For long positions:

Buy pound when the quote reaches 1.2166 (green line on the chart) and take profit at the price of 1.2210 (thicker green line on the chart). Growth is possible, but it will only be only in the morning. Nevertheless, when buying, make sure that the MACD line is above zero or is starting to rise from it. Pound can also be bought at 1.2136, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2166 and 1.2210.

For short positions:

Sell pound when the quote reaches 1.2136 (red line on the chart) and take profit at the price of 1.2100. Pressure may return if upcoming US reports exceed expectations. However, when selling, make sure that the MACD line is below zero or is starting to move down from it. Pound can also be sold at 1.2166, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2136 and 1.2100.

What's on the chart:

The thin green line is the key level at which you can place long positions in the GBP/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the GBP/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decision based on the current market situation is an inherently losing strategy for an intraday trader.